Second cinema in works for Downtown

DOWNTOWN ‚Äî A second new movie theater is being planned for Santa Monica.

ArcLight Cinemas is in negotiations with City Hall to put a theater on the land where Parking Structure 3 currently stands ‚Äî on Fourth Street at Arizona Avenue, said Andy Agle, director of Housing and Economic Development.

A preliminary agreement that would allow ArcLight to start drawing up official plans could go before City Council later this month.

At that same meeting, council will consider final approval of another ArcLight theater proposed for the third level of the Santa Monica Place mall. Those plans have been in the works since last year. The Santa Monica Place theater could include up to 13 screens and 1,500 seats.

The plans for the theater on Fourth Street are still in the very early stages but, Agle said, despite the fact that they include more proposed seats than the Santa Monica Place theater, it‚Äôs unlikely that there will be significantly more screens.

“They‚Äôre bigger auditoriums,” he said. “That‚Äôs where the large IMAX will be. When there‚Äôs a highly anticipated movie that everyone wants to see on the big screen … that‚Äôs going to be the place to go.”

Both theaters would show blockbuster films like, for example, “The Hunger Games,” Agle said, but movie-goers will choose the venue based on viewing preferences.

“If you want to see a film like that in a more intimate setting you may choose to go to Santa Monica Place,” he said. “If you want to see it in IMAX in the big auditorium, you‚Äôll likely choose Fourth Street.”

The Santa Monica Place Arclight may have an IMAX screen, Agle said, but it likely won‚Äôt be as large as screens planned for the Fourth Street location.

The Santa Monica-based mall operator Macerich, which owns Santa Monica Place, will likely serve as the developer for both projects.

City Hall would negotiate a ground lease with Macerich, who would in turn have a sublease with ArcLight.

Agle likes the set-up because it allows Macerich to change operators when the sublease expires if for some reason ArcLight falls out of favor with the public.

Some members of the Downtown Santa Monica Inc. Board of Directors were concerned that Macerich would have reasons to favor the Santa Monica Place location over the Fourth Street location.

“The theater will be a little extra that they had to do or they wanted to do at the time but I don‚Äôt think they‚Äôre going to be too concerned about the property value of that one theater being affected by how well the promenade is doing,” said boardmember Bill Tucker. “I think they‚Äôre going to focus on their shopping center.”

Consultant Rob York pointed out that if the rent structures of the two projects are different there might be an incentive to show high-volume films at one location leaving the other location with the dregs.

“I would guess that ArcLight wouldn‚Äôt allow that but it depends on who‚Äôs got the leverage,” he said.

Agle said that ArcLight has been having that discussion with City Hall.

“They‚Äôve been very clear in terms of deal structure and how they operate that it needs to be their choice to put the movies where it makes the most sense,” he said.

Other Santa Monica theaters are reducing seat totals, Agle said.

At its Second Street location, the Laemmle plans to significantly reduce seats and add a cafe, he said.

AMC, which has about 2,500 seats in the city, has not stated any official plans for their theaters, Agle said, but as a general rule the company is reducing seats to make the remaining ones more comfortable.

A deal that would have allowed AMC to build a theater on the same Parking Structure 3 property fell through in 2012.

“Likely what we‚Äôll see is a dramatic drop in the number of seats in the AMC theaters but I think they‚Äôre still going to try to be an important player in Santa Monica,” Agle said. “That‚Äôs what they told us when they told us they wouldn‚Äôt be negotiating with us anymore.”

The Criterion is closed for good, he said. The building is being renovated and will reopen as retail, he said.

ArcLight, Agle said, is a good match for the city by the sea.

“They show the big blockbusters and also foreign and independent films,” Agle said. “And given Santa Monica and the diversity we‚Äôve got here, it seems like that‚Äôs a nice mix.”

If council votes to move the project forward later this month it will still have to go through numerous stages of planning with City Hall before coming again before council for a final vote.

Construction could start as early as 2016 and take up to 18 months, Agle said.